Slide 1: CFO update
Fredrik Nilsson Chief Financial Officer and acting Chief Executive Officer CFO update The Co-Development Company
Slide 2: How we measure success
How we measure success Important financial Organic volume growth Operating profit KPIs Higher than market growth Double-digit growth Strong balance ROCE Free cash flow A balancing act sheet Cash is king Net debt / EBITDA < 3.0 2 The Co-Development Company
Slide 3: AAK's performance – a history of success (CAGR)
AAK’s performance – a history of success (CAGR) Operating profit Volume* improvement* +7.9% +11.5% EPS Dividend improvement* increase* +8.3% +10.5% * CAGR 2010 - 2017 3 The Co-Development Company
Slide 4: Good progress in most of the focus areas 2017
Good progress in most of the focus areas 2017 Organic growth 5% higher than underlying market growth Operating profit > 10% year-on-year improvement Return on capital employed (ROCE) Has started to increase again after greenfield investments and acquisition of California Oil Corporation Strong balan
Slide 5: Income statement
Income statement Volume*, Operating profit, Operating profit (‘000 MT) SEK million per kilo*, SEK 2017 2016 Change % 2017 2016 Change % 2017 2016 Change % 1,579 1,442 137 10% 1,315 1,180 135 11% 0.83 0.82 0.01 1% Financial net, Tax, Earnings per SEK million SEK million share, SEK 2017 2016 Change %
Slide 6: Revenue split by country
Revenue split by country 49% 6 The Co-Development Company
Slide 7: Split of costs
Split of costs 7 The Co-Development Company
Slide 8: FX exposure
FX exposure Movement vs SEK EBIT impact USD MXN GBP EUR TRY 8 The Co-Development Company
Slide 9: Balance sheet, SEK million
Balance sheet, SEK million Total non- Working capital Net debt current assets 2017 2016 Change % 2017 2016 Change % 2017 2016 Change % 7,153 7,027 126 2% 4,447 3,582 865 24% 3,233 3,165 68 2% Net debt / Equity to asset EBITDA, multiple ratio, % 2017 2016 Change % 2017 2016 Change % 1.43 1.59 -0.16 -
Slide 10: Working capital
Working capital More than SEK 1,500 million in reduced working capital since 2011 10 The Co-Development Company
Slide 11: Raw material prices
Raw material prices Rapeseed oil Palm oil 1 000 900 800 700 USD/ton 600 500 400 300 11 The Co-Development Company
Slide 12: Cash flow
Cash flow SEK million Q3 2017 YTD 2017 Q3 2016 YTD 2016 EBITDA 595 1,680 529 1,505 Paid interest -35 -99 -49 -121 Paid tax -98 -385 -134 -325 Non-cash items -126 -291 -14 0 Change in working capital (WC) 156 -650 -467 -689 Cash flow from operating activities incl. changes in WC 492 255 -135 370 Cash
Slide 13: Return on Capital Employed (ROCE)
Return on Capital Employed (ROCE) We target a gradual and continuous improvement Growth ROCE end Q3 2017* (Volume and mix) 15.4% Capital EBITA LTM employed SEK million SEK million Profit Capital employed 1,765 (Operating profit) (Focus WC) 11,448 Ensure strong operating Run business to optimize leve
Slide 14: Solid debt portfolio
Solid debt portfolio Structure of loans and borrowings Interest-bearing debt SEK 3,810 million as at September 2017 SEK 3,006 million of unused committed credit facilities as at September 2017 2 000 Main financing sources 1 800 EUR 400 million club loan 1 600 Maturing in H1/2021 1 400 SEK 1,400 mill
Slide 15: A strong balance sheet ensures maximum flexibility
A strong balance sheet ensures maximum flexibility Improvement since 2010 Net debt and Net debt/EBITDA Equity and Equity ratio 15 The Co-Development Company
Slide 16: How we allocate capital
Investments and capital allocation Priorities How we allocate To be well-capitalized capital (Net debt/EBITDA < 3x) We maximize room To pay stable dividends to invest in growth (30-50% pay-out ratio) and shareholder Invest in organic growth return Mergers and acquisitions 16 The Co-Development Compa
Slide 17: Balanced cash flow and CAPEX
Balanced cash flow and CAPEX Investments done enhancing growth areas New plant in Brazil 2015-2016 New plant in China 2016-2017 Capacity additions related to acquisition of California Oils Corporation Debottleneck CAPEX Balanced cash flow and CAPEX Good maintenance CAPEX control Prudent strategic pr
Slide 18: Potential volume growth
Potential volume growth MT 2 500 2 400 2 300 2 200 2 100 2 000 1 900 1 800 1 700 1 600 2016 2017 2018 2019 Existing business CalOils Greenfield Brazil Greenfield China 18 The Co-Development Company
Slide 19: Our long-term management ambition – result after nine months
Our long-term management ambition – result after nine months +11% +13% +13% Average 10% year-over-year EBIT improvement* -3% -30% *Excluding acquisitions and at fixed FX 19 The Co-Development Company
Slide 20: AAK investment case highlights
AAK investment case highlights 1 2 3 4 Above the Average 10% Strong Very strong market year-over-year balance sheet underlying operating profit supporting growth drivers growth improvement* further growth Indulgence Health Trust Personalization Convenience * Excl. acquisitions and fixed FX 20 The Co
Slide 21: Thank you!
Thank you! www.aak.com The Co-Development Company